Working past 65 and Medicare do not always fit together neatly. You turn 65. Medicare eligibility begins. But you still have a job, and a health plan attached to it. So the question arrives: do you have to sign up now? The honest answer is that it depends on two things. It depends on how many people your employer has. It also depends on whether the coverage counts as current employment coverage.
- The Rule Behind Working Past 65 And Medicare
- Your Choices at 65
- The Penalty If You Get It Wrong
- Working Past 65 And Medicare: the Paperwork
- The Traps People Fall Into
- Frequently Asked Questions
- Key Takeaways: Working Past 65 And Medicare
- Compare Your Options
- Official Sources & Resources
- Related Guides
This guide walks through the rule, the two forms, the deadlines and the penalty arithmetic. It also flags the traps that catch people who assume working past 65 and Medicare can simply wait. Nothing here is legal or tax advice. Medicare publishes the enrollment rules on Medicare’s working past 65 page, and that is the page to check against your own situation.
The Rule Behind Working Past 65 And Medicare
The rule is called Medicare Secondary Payer, or MSP. It decides which insurer pays a claim first. For people age 65 or older who are still working, the deciding factor is employer size. CMS explains the framework on its Medicare Secondary Payer overview.
If the employer has 20 or more employees, the group health plan generally pays first. Medicare pays second. Full-time and part-time workers both count toward the 20-employee threshold. This is the “working aged” provision.
If the employer has fewer than 20 employees, the order usually flips. Medicare pays first. The group plan pays second. That matters enormously. A plan that pays second may pay almost nothing if you never enrolled in Part B.
The coverage must come from current employment. Yours or your spouse’s. Medicare’s who pays first page sets out the order of payment. This is the piece of working past 65 and Medicare that people most often get wrong. Retiree coverage and COBRA are not current employment coverage.
Ask your benefits administrator two questions in writing. How many employees does the company have? Does the plan pay primary or secondary once I turn 65? Get the answer on paper before you decide anything about working past 65 and Medicare.
Your Choices at 65
Your Initial Enrollment Period runs seven months. It starts three months before your 65th birthday month and ends three months after it. Most people with qualifying employer coverage take Part A only, or delay both parts.
Part A is premium-free for most people with 40 quarters of work credits. Part B carries a premium. CMS set the standard 2026 Part B premium at $202.90 a month, with a $283 annual deductible, in its 2026 Parts A and B premiums fact sheet. Higher-income enrollees pay more.
| Your situation | Who generally pays first | What to do |
|---|---|---|
| Employer with 20 or more employees, you or your spouse still working | Group health plan first, Medicare second | You may delay Part B without penalty. Confirm plan status in writing. Enroll later using the Special Enrollment Period. |
| Employer with fewer than 20 employees | Medicare first, group plan second | Enrolling in Part A and Part B at 65 is usually necessary. Ask the plan what it pays if you decline Part B. |
| Multi-employer or union plan | Depends on whether any participating employer has 20 or more employees | Ask the plan administrator directly. Do not assume. |
| COBRA or retiree coverage only | Medicare first | This is not current employment coverage. Sign up during your Initial Enrollment Period. |
| Marketplace plan or self-employed with no group plan | Medicare first | No employer protection applies. Enroll during your Initial Enrollment Period. |
| Contributing to an HSA | Depends on employer size | Stop contributions before Part A begins. See the HSA trap below. |
One more wrinkle in working past 65 and Medicare: if you already collect Social Security, enrollment in Part A and Part B is automatic at 65. Declining Part A then means withdrawing your Social Security application and repaying benefits. Contact SSA before doing anything of that kind.
The Penalty If You Get It Wrong
The Part B late enrollment penalty is 10% of the standard premium for each full 12-month period you could have had Part B and did not. It is added to your monthly premium. Medicare describes it on its avoid late enrollment penalties page.
Run the arithmetic. Suppose you go 24 full months without Part B and have no Special Enrollment Period. That is a 20% penalty. Against the 2026 standard premium of $202.90, that is roughly $40.58 extra each month. The percentage applies to the standard premium each year, so the dollar figure moves as the premium moves.
The Part B penalty lasts for as long as you have Part B. For most people that means for life. It does not expire after a few years.
Part D works differently. The penalty is 1% of the national base beneficiary premium times the number of full uncovered months without creditable drug coverage. The 2026 national base beneficiary premium is $38.99, per Medicare’s Part D cost page. Twenty uncovered months is 20%, or about $7.80 a month, rounded to the nearest ten cents.
That Part D amount is recalculated each year and follows you between plans. It also lasts as long as you keep drug coverage. Ask your employer for its annual creditable coverage notice and keep it.
Part A has its own penalty, but only if you must buy Part A. It is 10%, paid for twice the number of years you delayed. The stakes are why working past 65 and Medicare deserves a written answer, not a guess.
Working Past 65 And Medicare: the Paperwork
Two forms do the work. The first is Form CMS-40B, Application for Enrollment in Medicare Part B. You complete and sign that one yourself.
The second is Form CMS-L564, Request for Employment Information. You fill in Section A. Your employer or the group health plan completes and signs Section B. That signature is the proof that you had coverage based on current employment.
Both forms go to the Social Security Administration, not to Medicare. SSA explains submission options on its sign up for Part B only page, including online upload, fax and mail to your local field office.
The deadline has a name: the Special Enrollment Period. It runs eight months. It begins the month after employment ends or the month after group coverage ends, whichever comes first. Do not wait for the coverage to lapse.
❤️ Get Free Medicare Guides
Free · No spam · Unsubscribe anytime
Applying while still covered usually avoids a gap. For drug coverage, the Part D special enrollment window is shorter, generally two months after creditable coverage ends. If your employer will not sign the CMS-L564, call SSA at 1-800-772-1213 and ask what alternative proof it accepts. Do not skip the deadline while waiting.
If you miss the Special Enrollment Period entirely, the fallback is the General Enrollment Period, January 1 through March 31. Confirm current coverage start dates with SSA when you apply, since those rules changed in recent years.
The Traps People Fall Into
COBRA is the first trap. It is not current employment coverage. Your Part B Special Enrollment Period generally starts when the job ends, not when COBRA runs out. Many people discover this months too late.
Retiree coverage is the same trap wearing a different name. It usually pays secondary to Medicare. Ask the retiree plan directly what it pays if you have no Part B.
The HSA trap is the expensive one. Once Medicare begins, your HSA contribution limit is zero, as IRS Publication 969 explains. Part A can also be backdated up to six months when you enroll after your Initial Enrollment Period, and never before your 65th birthday month.
Contributions made during that retroactive window become excess contributions. Many people stop HSA deposits about six months before enrolling. Confirm your own timing with a tax professional and check the Form 8889 instructions on irs.gov.
The last trap is the small employer. Fewer than 20 employees usually means Medicare pays first. Skipping Part B there can leave large bills unpaid.
Frequently Asked Questions
Do I have to sign up for Medicare at 65 if I am still working?
Not always. If your employer has 20 or more employees and the coverage is based on current employment, you may generally delay Part B without penalty. If the employer has fewer than 20 employees, enrolling is usually necessary. Confirm the plan’s payer status with your benefits administrator.
Should I take premium-free Part A while still working?
Many people do, because it costs nothing with 40 quarters of credits. But Part A ends HSA eligibility. If you contribute to an HSA, that trade-off is the whole decision on working past 65 and Medicare.
How long do I have to enroll after I retire?
The Part B Special Enrollment Period is eight months. It starts the month after employment or group coverage ends, whichever is first. File Forms CMS-40B and CMS-L564 with SSA. Applying before coverage ends helps avoid a gap.
Can a late enrollment penalty ever be removed?
SSA has a reconsideration process, and equitable relief exists in limited circumstances. Outcomes are not guaranteed. Ask SSA how to request reconsideration and keep every coverage notice. Documentation is what makes working past 65 and Medicare defensible later.
Key Takeaways: Working Past 65 And Medicare
- Employer size decides everything. Whether working past 65 and medicare is a choice or a requirement turns on the 20-employee rule.
- Part A is usually free. Most people take it at 65 even when working past 65 and medicare lets them delay Part B.
- Except with an HSA. Part A ends HSA contributions, the one case where working past 65 and medicare means delaying Part A too.
- COBRA does not count. For working past 65 and medicare, COBRA is not active employer coverage, and assuming otherwise creates a lifetime penalty.
- The penalty never ends. The Part B penalty from a working past 65 and medicare mistake is added to every premium for life.
- Keep the creditable coverage letter. It is the proof that working past 65 and medicare did not leave a gap in drug coverage.
Compare Your Options
Once you know what working past 65 and medicare means for you, the official Plan Finder shows what is actually sold in your ZIP code, and a SHIP counselor will walk it with you for free — no commission, no sales call.
Official Sources & Resources
- Social Security — Medicare enrollment: https://www.ssa.gov/medicare
- IRS Publication 969 (HSAs): https://www.irs.gov/publications/p969
- Medicare.gov: https://www.medicare.gov
- CMS.gov: https://www.cms.gov
- Find your SHIP counselor: https://www.medicare.gov/talk-to-someone
Checked against the official sources above in September 2026. Rules and dollar figures change; if a notice you received disagrees with this page, the notice wins — and please tell us. General information, not legal, financial or medical advice.